USD Stable Premiums Rise in Argentina After Economy Minister Resigns

Argentina has long struggled with rising inflation and the continued decline of the peso against the US dollar.

Argentina, a country with one of the highest crypto adoption rates in the world, saw the price of U.S. dollar-pegged stablecoins on exchanges on Saturday after the abrupt resignation of its Minister of the Economy, Martin Guzman.

The minister's shock exit, confirmed on his Twitter account on Sunday via a seven-page letter, threatens to further destabilize a struggling economy battling high inflation and a depreciating national currency.

According to data from Criptoya, the cost to buy Tether (USDT) in Argentinian Pesos (ARS) is currently 271.4 ARS via the Binance exchange, a premium of around 12% compared to before announcement of the resignation, and a premium of 116.25% over the current fiat exchange rate of USD/ARS.

The local crypto price-tracking website also revealed a similar jump in other USD-pegged stablecoins, including Dai (DAI), Binance USD (BUSD), Pax Dollar (USDP), and Dollar on Chain (DOC).

Argentines have invested in crypto to hedge against rising inflation in the country and the continued decline of the Argentine peso against the USD.

In 2016, before inflation really took its toll, a dollar could only buy about 14.72 Argentine pesos. However, six years later, one dollar can buy up to ARS 125.5.

The additional premium on US dollar-pegged stablecoins is the result of a law passed on September 1, 2019, called Decree No. 609/2019, and has...